Are you hiring your first employee? Well done!
Just make sure you are aware of your responsibilities as an employer.
A few things you must do
- Decide how much you want to pay your employee before you are hiring them! By law, you are required to pay at least the National Minimum Wage (currently £7.50 an hour). Check what the applicable National Minimum Wage is at the time.
- Check if they have the right to work in the UK. Ask for their original passport or ID card and take a copy for your records. You may have to do other employment checks as well.
- Check if you need to apply for a DBS check if you work in a field that requires one.
- Get Employer’s Liability Insurance.
- Send your employee a written statement of employment if you are employing them for more than one month.
- Register as an employer with HMRC ( see my Registration article on how to register).
- Check if you need to auto enrol your staff into a pension scheme. If the company is newly registered, I believe you will not need to register for a workplace pension immediately. For example, if you paid your first PAYE income between 1st July 2017 and 30th Sept 2017, you will have to enrol by 1st Feb 2018. Check with HMRC if you are unsure.
- If you are a sole director and shareholder of your limited company and pay yourself a salary, you must still register as an employer with HMRC. However you don’t have to auto-enrol into a workplace pension! If you have received a letter from HMRC asking for a statement of compliance, let them know you are not an employer. You can do that online on the government website.
You will have to give your employee an employment contract which is basically an agreement that sets out an employee’s:
- employment conditions
Employees and employers must stick to a contract until it ends or until the terms are changed (usually by agreement between the employee and employer).
But if someone agrees to do some work for you say create your website, it’s not an employment contract but a ‘contract to provide services’! Make sure you understand the difference!
As soon as someone accepts a job offer they have a contract with you as their employer. An employment contract doesn’t have to be written down. The legal parts of a contract are known as ‘terms’. An employer should make clear which parts of a contract are legally binding.
Contract terms could be:
- in a written contract, or similar document like a written statement of employment.
- verbally agreed.
- in an employee handbook.
- in an offer letter.
- required by law (eg an employer must pay employees at least the National Minimum Wage).
- in collective agreements – negotiated agreements between employers and trade unions or staff associations.
- implied terms – automatically part of a contract even if they’re not written down.
Employee rights and responsibilities
Your employee has certain rights you must understand and apply
- Statutory Sick Pay.
- Statutory maternity, paternity, adoption and shared parental leave and pay.
- Minimum notice periods if their employment will be ending, for example if an employer is dismissing them.
- Unfair dismissal protection.
- The right to request flexible working
- Time off for emergencies
- Statutory Redundancy Pay
Some rights require a minimum length of continuous employment before the employee qualifies.
I have provided you with a brief overview and I will be writing a lot more articles on the subject. Just remember! Employment law can be quite complicated and you will also need to process the payroll as well as submit a variety of information to HMRC.
I would suggest to get in touch with a HR and a payroll company.
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